Haris Ashley
Medicare is a federal health insurance program for individuals aged 65 and over, as well as certain individuals under 65 with disabilities or specific conditions. There are two main ways to obtain Medicare coverage: Original Medicare and Medicare Advantage. Original Medicare includes Part A (Hospital Insurance) and Part B (Medical Insurance), covering inpatient hospital care, doctor services, tests, and preventive services. Medicare Advantage, also known as Part C, is a Medicare-approved plan offered by private companies that combines Part A, Part B, and often Part D (drug coverage). Medicare Advantage may offer additional benefits not covered by Original Medicare, such as vision, hearing, and dental services. Individuals with Medicare can also purchase supplemental coverage, such as Medicare Supplement Insurance (Medigap), to help pay for out-of-pocket expenses. Medigap policies are standardized and named by letters, with consistent benefits across insurance companies.
| Characteristics | Values |
|---|---|
| Type | Federal health insurance |
| Administered by | Medicare-approved private companies |
| Eligibility | Anyone 65 and older, and some people under 65 with certain disabilities or conditions |
| Coverage | Hospital insurance (Part A) and medical insurance (Part B); some plans include drug coverage (Part D) and may offer extra benefits like vision, hearing, and dental services |
| Cost | Varies depending on the plan; generally, you pay for services as you get them, with Medicare covering part of the cost |
| Choice of providers | Original Medicare allows you to see any doctor or hospital that accepts Medicare anywhere in the US; Medicare Advantage plans may have specific networks of providers |
| Supplemental coverage | Medicare Supplement Insurance (Medigap) helps pay your share of costs; other options include coverage from a former employer or union, or Medicaid |
| Enrollment | You can choose between Original Medicare and Medicare Advantage plans; there may be penalties for late enrollment in certain cases, such as adding a drug plan |
| Coordination with other insurance | When an individual has Medicare and other health insurance, one will be the primary payer and the other the secondary payer, depending on various factors |
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What You'll Learn
Medicare Part A and Part B
Medicare is federal health insurance for anyone aged 65 or older, as well as some people under 65 with certain disabilities or conditions. There are four parts to Medicare: Part A, Part B, Part C, and Part D.
Medicare Part A is hospital insurance. It helps cover inpatient care in hospitals, skilled nursing facility care, hospice care, and home health care. Most people get Part A for free, but some have to pay a premium for this coverage. To be eligible for premium-free Part A, an individual must be entitled to receive Medicare based on their own earnings or those of a spouse, parent, or child. To receive premium-free Part A, the worker must have a specified number of quarters of coverage (QCs) and file an application for Social Security or Railroad Retirement Board (RRB) benefits. The exact number of QCs required depends on whether the person is filing for Part A on the basis of age, disability, or End Stage Renal Disease (ESRD). Individuals are eligible for premium-free Part A if they receive regular dialysis treatments or a kidney transplant, have filed an application for Medicare, and meet one of the following conditions: they have worked the required amount of time under Social Security, the RRB, or as a government employee; they are getting or are eligible for Social Security or RRB benefits; or they are the spouse or dependent child of a person who has worked the required amount of time under Social Security, the RRB, or as a government employee, or they are getting Social Security or RRB benefits. People who must pay a premium for Part A do not automatically get Medicare when they turn 65. They must file an application to enrol and also enrol in or already have Part B. To keep premium Part A, the person must continue to pay all monthly premiums and stay enrolled in Part B. This means that the person must pay both the premium for Part B and the premium for Part A to keep this coverage. Premium Part A coverage begins the month after the month of enrolment. A person who is entitled to monthly Social Security or RRB benefits on the basis of disability is automatically entitled to Part A after receiving disability benefits for 24 months. Disabled federal, state and local government employees who are not eligible for monthly Social Security or RRB benefits may get deemed entitlement to disability benefits and automatically entitled to Part A after being disabled for 29 months. Certain Federal, State, and local government employees pay only the Part A portion of the FICA tax. The QCs they earn can be used only to meet the requirements for premium-free Part A; they may not be used to meet the requirements for monthly Social Security benefits. To be eligible for premium-free Part A on the basis of age, an individual must be eligible for monthly Social Security or RRB cash benefits. An individual who is receiving monthly Social Security or RRB benefits, at least 4 months prior to turning age 65, does not need to file a separate application to become entitled to premium-free Part A. In this case, the individual will get Part A automatically at age 65. An individual who is not receiving monthly Social Security or RRB benefits must file an application for Medicare by contacting the Social Security Administration.
Medicare Part B is medical insurance. Original Medicare covers inpatient hospital care, doctors' services and tests, and preventive services. You must be lawfully present in the US for Medicare to pay for Part A and Part B-covered services. You pay for services and items as you get them. When you get a covered service, Medicare pays part of the cost and you pay your share. You can see any doctor or hospital that takes Medicare, anywhere in the US.
Once you've signed up for Part A and Part B, you can choose how you get your health coverage. There are two main ways to get your Medicare coverage: Original Medicare and Medicare Advantage. Original Medicare includes Part A and Part B. You can join a separate Medicare drug plan to get Medicare drug coverage (Part D). You can use any doctor or hospital that takes Medicare, anywhere in the US. You can also shop for and buy supplemental coverage that helps pay your out-of-pocket costs (like your 20% coinsurance). Medicare Advantage is a Medicare-approved plan from a private company that offers an alternative to Original Medicare for your health and drug coverage. These "bundled" plans include Part A, Part B, and usually Part D. In many cases, you can only use doctors who are in the plan's network. Plans often have different out-of-pocket costs than Original Medicare or supplemental coverage like Medigap. You may also have an additional premium. Plans may offer some extra benefits that Original Medicare doesn’t.
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Medicare Advantage Plans
Medicare Advantage, also known as Medicare Part C, is an alternative to Original Medicare. It is a bundled health insurance plan provided by private companies in contract with the federal government. Medicare Advantage plans provide the same benefits as Medicare Part A (hospitalisation) and Part B (doctor's visits) and often include Part D prescription drug coverage.
In 2023, 49% of Medicare beneficiaries were enrolled in Medicare Advantage plans, and by 2025, these plans are projected to account for over half of all enrolments. Medicare Advantage plans offer lower costs, with many having no monthly premiums, and spending caps on out-of-pocket expenses. However, there may be restrictions on switching back to Original Medicare, and prior authorisation requirements for certain tests or procedures.
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Medicare with other insurance
Medicare is federal health insurance for anyone aged 65 or older and some people under 65 with certain disabilities or conditions. It can be combined with other insurance plans, like Tricare military health insurance, Veterans Affairs (VA) benefits, or Medicaid. If you have Medicare and another health insurance plan, one will be the "primary payer" and the other will be the "secondary payer". The primary payer pays up to the limits of its coverage, and then sends the rest of the balance to the secondary payer. If the secondary payer doesn't cover the remaining balance, you may be responsible for the remaining costs.
The primary payer is usually the insurance plan that you had before you signed up for Medicare. If you get health insurance coverage through a large employer, that insurance will likely be your primary payer, and Medicare will be your secondary payer. If your insurance is provided by an employer with fewer than 20 employees, or you get retiree healthcare benefits from a former job, Medicare is likely to be your primary payer. If you have Medicare and COBRA, the provider that pays first depends on your specific situation.
Medicare may also be the primary payer if you have a disability or ALS, and your company has fewer than 100 employees. If you have ESRD, your group health plan will pay first during a 30-month coordination period, regardless of the company's number of employees. If you have employer health insurance and Medicare but get services outside of your insurance network, it's possible that neither Medicare nor your insurance plan will pay for the care.
Medicare Supplement Insurance (Medigap) is extra insurance you can buy from a private company that helps pay your share of costs in Original Medicare. Medigap policies are standardized and, in most states, are named by letters like Plan G or Plan K. Generally, you need Part A and Part B to buy a Medigap policy.
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Medigap policies
Medicare is federal health insurance for anyone aged 65 or older and some people under 65 with certain disabilities or conditions. There are two main ways to get Medicare coverage: Original Medicare and Medicare Advantage. Original Medicare includes Part A (Hospital Insurance) and Part B (Medical Insurance). It covers things like inpatient hospital care, doctors' services and tests, and preventive services.
You should buy a Medigap policy within 6 months of getting Part A and Part B, or you may not be able to buy a policy or may have to pay more. Medigap policies do not cover long-term care, vision, dental, hearing aids, private-duty nursing, or prescription drugs. However, some Medigap plans cover foreign travel emergency services. Once enrolled, your plan renews every year as long as you pay your premium and the plan is available.
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Medicare drug plans
Medicare is federal health insurance for anyone aged 65 and over, as well as some people under 65 with certain disabilities or conditions. There are two main ways to get Medicare coverage: Original Medicare and Medicare Advantage. Original Medicare includes Part A (Hospital Insurance) and Part B (Medical Insurance). It covers things like inpatient hospital care, doctors' services and tests, and preventive services. You pay for services as you receive them, and Medicare covers part of the cost.
Medicare Advantage Plans are offered by private companies that contract with Medicare. They provide Part A and Part B benefits to people with Medicare. Medicare Advantage is an alternative to Original Medicare for health and drug coverage. Most Medicare Advantage Plans include Part D coverage, which helps pay for prescription drugs.
If you choose Original Medicare, you can add drug coverage by joining a separate Medicare drug plan (Part D). This is optional and available to everyone with Medicare. Each plan has a list of covered drugs called a "formulary", which varies in cost and specific drugs covered. Most plans have a monthly premium that you pay in addition to your Part B premium.
It is important to note that you may pay a Part D late enrollment penalty if you don't join a Medicare drug plan when you first get Medicare and go 63 days or more without creditable drug coverage. This penalty increases the longer you wait to join a plan, and you will likely pay it for as long as you have Part D coverage.
Medigap is extra insurance you can buy from a private health insurance company to help pay your share of out-of-pocket costs in Original Medicare. Medigap policies are standardized and, in most states, are named by letters, like Plan G or Plan K. The benefits in each lettered plan are the same, regardless of the insurance company. The price is the only difference between policies with the same letter sold by different companies.
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Frequently asked questions
Medicare is federal health insurance for anyone aged 65 and over, as well as some people under 65 with certain disabilities or conditions. There are two main ways to get your Medicare coverage: Original Medicare and Medicare Advantage. Original Medicare includes Part A (Hospital Insurance) and Part B (Medical Insurance).
Part A covers inpatient hospital care, doctors' services and tests, and preventive services.
Part B is Medical Insurance. It is usually paired with Part A to make up Original Medicare.
Medicare Advantage is a Medicare-approved plan from a private company that offers an alternative to Original Medicare for your health and drug coverage. It bundles your Part A, Part B, and usually Part D coverage into one plan.
